Explained – Why Bharat Dynamics shares fell up to 4% on Monday

Explained - Why Bharat Dynamics shares fell up to 4% on Monday


Shares of Bharat Dynamics Ltd. (BDL) declined 4% on Monday, July 13, following reports that the Centre is preparing to allow private companies to manufacture missiles, a move that could reshape India’s defence production landscape.

According to a report by Hindustan Times, the Defence Ministry is expected to invite bids from private players to manufacture the Astra Mark 2 beyond-visual-range (BVR) air-to-air missile, developed by the Defence Research and Development Organisation (DRDO).

The proposed move is being viewed as one of the most significant reforms in India’s defence manufacturing policy, as missile production has largely remained the domain of state-owned defence companies.

While private firms already manufacture aircraft components, drones, artillery systems and naval platforms, missile manufacturing has so far remained largely restricted to the public sector.

At present, Bharat Dynamics enjoys a dominant position in India’s missile manufacturing ecosystem. However, the report noted that rising demand for advanced missile systems has outpaced its production capacity, prompting the government to widen private sector participation.

The report said the Defence Ministry is likely to issue a Request for Proposal (RFP) for the Astra Mark 2 programme, with companies such as Adani Defence, Bharat Forge, Tata Group, Mahindra Group, and ICOMM expected to participate in the bidding process.

The report also stated that the Pralay tactical ballistic missile could become the next indigenous missile programme to be opened to private companies for both development and manufacturing.

In addition to domestic demand, the Astra Mark 2 has also attracted international interest, with Indonesia reportedly exploring the possibility of procuring the missile.



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